Do you need an LLC?

An LLC (limited liability company) is a legal structure that separates your business from you personally. If the business is sued or cannot pay its debts, your personal assets, like your house and savings, are generally protected. For a hobby designer pitching games to publishers, this protection usually matters very little, because you are not manufacturing, selling, or shipping anything. For a self-publisher taking customer money and importing products, it starts to matter a lot.

The common rule of thumb in the industry is that the moment you take money from strangers, you should be operating as a business. A crowdfunding campaign is exactly that moment. You are collecting funds, making promises about delivery, and importing a physical product that a child might chew on. Any of those creates real, if small, liability, and an LLC is the standard way small publishers contain it.

Forming an LLC in the United States typically costs somewhere between fifty and a few hundred dollars in state filing fees, plus small annual fees that vary widely by state. The paperwork is manageable without a lawyer in most states, and online formation services handle it for a modest fee. The ongoing obligation that trips people up is not the formation, it is keeping business money separate. An LLC only protects you if you treat it as a real, separate entity, with its own bank account and its own books.

This is general information, not legal advice. Rules differ by state and country, and your personal situation (other assets, a spouse's income, an existing business) changes the math. A one-hour consultation with a small business attorney or accountant before your first campaign is cheap insurance and usually answers every question on this page for your specific case.